Understand On Demand

Hi, my name is Adam Gross. I'm from a company called Salesforce.com and today I want to talk about one of the questions that comes up most frequently when I'm talking to people about new technology, which is on demand and really understanding 'on demand.' Lots of different companies are using the word 'on demand' to describe a lot of different things, so when you want to know what exactly they mean, it's important to keep two different concepts in mind.

The first is what's called 'single tenant' and you can think about the difference just like you think the difference between buildings. You have single-family homes and you have apartment buildings. The second kind is called 'multi-tenant' and just like in real estate in 'single tenant on demand,' each customer in each application gets their own dedicated stock, meaning they get their own dedicated hardware. They get their own dedicated operating system. They get their own dedicated application and as many customers as you have for that application, you'll see an entirely new stock creator and each individual stack is going to resemble exactly the same configuration that you have in your server room today except of course that it's going to be running on a different site and you're going to be accessing it over the Internet.

In 'multi-tenant,' all customers of an application share one big platform and a great example of the difference here is something like e-mail. In 'single tenant' on demand with e-mail, you're going to have your own dedicated stack, maybe you're running exchange server or something like that, that's going to be run exclusively for you. In 'multi-tenant' on demand, this is something closer to what Yahoo offers with their e-mail service or Google offers with Gmail. And in that model, every customer is occupying the same platform, but just occupying the piece that they need so if you just need a little bit of e-mail service you just take up that much room. If you have a lot of e-mail, you're able to dynamically expand to use as much space as required. The main difference then of course is deploying an entire new stack. An entire new piece of infrastructure is not only going to cost a lot more than just provisioning the tiny amount of virtual resources that you need, but of course when it comes time for upgrades or maintenance each individual stack will need to be upgrade or maintained individually versus upgrading and maintaining the stack at once as you do with 'multi-tenant' on demand.

The exciting trend that's happening now is that not only are applications like e-mail available in 'multi-tenant,' but increasingly enterprise applications like (CRM) Customer Relationship Management and (ERP) Enterprise Resource Planning. Those kinds of applications are available in the same model and what that means is the same kind of cost difference that you saw between traditional e-mail and 'multi-tenant' e-mail, we now see with things like 'multi-tenant' CRM and 'multi-tenant' ERP giving those up, making those applications available much more effectively, much more inexpensively, and much more quickly than has been required in the old 'single tenant' on demand model.

So with that hopefully you have an understanding of the key question you need to ask when the next person talks to you about 'on demand' which is, is it 'single tenant' or is it 'multi-tenant' and now you know the difference.